Communication and Public Awareness

Transportation Funding...Don't let the Treasure Valley Fall through the Cracks

Why is transportation funding such a big deal?

Transportation is the lifeblood of our economy. Without a well-functioning transportation system, our residents can’t get to their jobs, our farmers and factories can’t get their goods to the market, and our stores can’t stock their shelves. Without the ability to get people and goods from “here” to “there,” our economy stops.

Our transportation also impacts our quality of life, from how much time we spend sitting in traffic, to the choices we have in how we get around, to the safety of those choices.

The big deal is that we don’t have enough money to maintain the system we have now, much less to “grow” the system for the future. The population of Ada and Canyon Counties alone is expected to increase to 1.022 million by the year 2040.

COMPASS estimates that the region will need an investment of approximately $642 million per year between now and 2040 to meet maintenance needs and the demands of growth. Funding estimates show that we are $291 million short of meeting those needs, each year, in Ada and Canyon Counties alone.

Without additional funding, your commute will look very different in 2040 than it does today. Even with the improvements planned and funded between now and 2040 your daily commute will get longer.

Commute 2018 2040
Drive time from the City of Caldwell to downtown Boise 39 minutes 55 minutes
Drive time from the City of Star to St. Luke's Regional Medical Center in downtown Boise 33 minutes 62 minutes
Drive time from the City of Nampa to Micron in southeast Boise 32 minutes 42 minutes

How do we pay for transportation now?

For the most part, transportation is funded through a “user pay” system – most of our transportation infrastructure is funded through fuel taxes, vehicle registration fees, and other mechanisms, as opposed to coming from general tax dollars. The federal fuel tax is placed in the federal Highway Trust Fund, then allocated to states. The State of Idaho collects gas tax and registration fees and places them in the state Highway Distribution Account. Transportation agencies use these and other funds to pay for transportation infrastucture.

  • Federal fuel tax:
    • 18.4¢ per gallon for gasoline; 24.4¢ per gallon for diesel
  • State fuel tax:
    • 32¢ per gallon for gasoline and diesel
  • Local property tax:
    • Assessed by highway districts
    • Assessed by cities in Canyon County
    • Also used by Valley Regional Transit, through contributions from cities (Valley Regional Transit cannot assess property tax itself)
  • Impact fees: ACHD and City of Nampa only:
    • Fees collected on new development
  • Vehicle registration fees:
    • ACHD (through a local option vote)
    • Idaho Transportation Department
  • Transit fares:
    • Collected by Valley Regional Transit and ACHD Commuteride

While transportation funding is extremely complicated, there are a few key issues that affect how it is collected, distributed, and used:

  • Fuel tax:
    • The state fuel tax increased by 7¢ per gallon in 2015; the federal fuel tax has not increased since 1993. Neither are adjusted for inflation, which means that without Legislative or Congressional action, transportation funding will not increase as transportation costs do.
  • Money silos:
    • There is not simply one “pot” of transportation funding. State and federal laws and policies frequently dictate how and where transportation funds can be used, putting the money in “silos.” For example, in Idaho, the state constitution prohibits fuel tax from being used for public transportation.
  • Donors vs donees:
    • In Idaho, we get more back in federal gas tax than our citizens put in, due to federal legislation that sets a minimum share per state regardless of population. The amount varies, but generally we get at least $1.50 for every $1 our citizens pay. This could change in the future, decreasing Idaho’s share of federal transportation dollars.
  • Gas mileage:
    • We have seen a significant increase in fuel economy in the past 20 years, and the trend is for even more hybrid, electric, and fuel efficient vehicles. While that is a good thing for the environment, it means that people are purchasing less fuel - therefore paying less in fuel tax - while still using the roads. Funding based on fuel usage cannot keep up with inflation.

What are our options and what do they mean to me? Infographic explaining that just two dollars per day per household would raise enough money to eliminate the transportation funding shortfall in Ada and Canyon Counties

While $291 million per year sounds like a lot, if we all contribute our share, it is only about $1 per person, per day. That’s less than a cup of coffee!

Many options exist to increase our transportation funding, including the option to do nothing. Below is a brief list of options.

Increase fuel tax rates and/or index those rates to the rate of inflation

  • Gasoline and diesel fuel are taxed on a per gallon rate, so do not increase as costs increase. Legislative or Congressional action is required to increase fuel tax rates. If the rates were indexed to inflation, the income generated through fuel tax could better keep up with increased costs.    
  • Idaho state fuel taxes cannot be used for public transportation, so increases to the fuel tax rate or indexing that rate to inflation would only address a portion of the transportation funding issue.

Institute a tax on vehicle miles traveled

  • A vehicle miles traveled tax, or road usage tax, charges drivers based on the number of miles driven, instead of the amount of fuel purchased. As vehicles become more fuel efficient, the amount of transportation funding generated through fuel taxes is decreasing. This type of tax ties the amount of tax to actual use and would provide a more stable funding mechanism than fuel taxes.

Increase state vehicle registration fees

  • State registration fees provide about 30% of the state's Highway Distribution Account funds and are used for roadway construction and maintenance.
  • Idaho state registration fees cannot be used for public transportation, so increases only address a portion of the transportation funding issue.

Institute a local option sales tax

  • Local option sales tax is a tool that allows a taxing district, such as a county or city, to present a local sales tax proposal, along with a description of the project the revenue would be used for, to the voters. The voters then decide if they wanted to tax themselves for that project. If the proposal passes, the tax is instituted and the project proceeds. If the proposal fails, no new tax is instituted and the project does not proceed – or at least goes back to the drawing board.
  • Outside of a few resort communities, this tool is not available in Idaho. Legislative action is needed to provide local entities with the authority to use local option sales tax.
  • This tool has the potential to provide flexibility to be used for all types of transportation (and other) community infrastructure projects, meaning it could be used to fund public transportation, unlike fuel tax and registration fees.